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Comment by wing-_-nuts | Hacker News Reader

I've honestly never understood the point of the tariffs.

1. They're massively unpopular and likely to cause electoral losses in '26 and '28 which will immediately undo them

2. Consumers know the tariffs will likely cause a recession, and will likely be undone in 4y. Pretty much every major spending purchase that can be delayed, will.

3. Companies know 4y is not enough time to invest in new supply chains or new manufacturing plants. Given sinking demand they will shed jobs and hunker down for the duration.

I can tell you, for myself? Any major purchases are now off the table. I will happily keep my 18 year old car running instead of buying a new honda civic. I'm perfectly content with the devices I currently have. I will root and install a third party rom instead of buying a new phone. My 3090 will happily play old / AA games for the duration. Travel will likely be reduced thanks to the weak dollar and anti us sentiment in general.

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People keep acting like there is some plan or higher thought process.

Sometimes, people are just morons.

Look at how Bessent had to sneak in and try and get the tariffs paused: https://www.wsj.com/politics/policy/trump-tariff-pause-navar...

There's no coordinated strategy there.

Apparently the guy is playing 3d chess. But they didn't say he's not very good at it.

We're more at the level of him looking at the chess board and trying to snack on the pieces.

Yes, but in this case the 'd' stands for dementia.

He's not playing chess, his only interest in chess in getting the game manufactures to stop their DEI policy of insisting on equal dark and light squares/pieces.

You know he’s an actual idiot based on his latest proclamation that he won’t escalate further against China because “then people won’t buy.”

We’re already way, way beyond levels that effectively freeze all trade between the two countries.

Which, if we’re to believe the sycophants, is just the price to pay to onshore manufacturing.

There's no coordinated strategy anywhere.

The people with real power voted him in to lower taxes, and in return he is nuking the economy, neutering the Pentagon, trashing public health, isolating the US from tourists and skilled immigrants, walking public education back at least a century, killing the next generation of R&D, murdering rational climate policy with a coal-powered chainsaw, and handing government software and data to enemy powers.

The entire machinery of governance - official and public, as well as off-the-record "do as I say and I'll fund your campaign" private - has folded like tissue paper.

The only pushback is from the judiciary, and their orders are as likely to be ignored as implemented. And parts of academia.

It's astonishing.

> nuking the economy, neutering the Pentagon, trashing public health, isolating the US from tourists and skilled immigrants, walking public education back at least a century, killing the next generation of R&D, murdering rational climate policy with a coal-powered chainsaw, and handing government software and data to enemy powers.

How is that any different from what has been going on in the past 40 years... Biden kept almost all of Trump's tariffs and other policies. And Trump kept a lot of Biden's policies and added on to them.

Did you really say how is that different?

This comment is so disingenous it's almost pointless to respond to.

Previous presidents did things because they genuinely believed that what they were doing was the right thing for America based on their deeply-held beliefs.

Trump has no beliefs. He does not act from rational thought. He does whatever makes him feel good in the immediate moment, without regard to the consequences or even his own prior words and deeds.

I think he genuinely believes in his own genius, and that it makes him some kind of messiah figure for US.

This comment is built on mind reading. Like you can tell what Joe Biden or Barack Obama genuinely believed, and what Donald Trump or George Bush were pretending to believe. No evidence can convince you one way or another because you've already read their minds and can tell who is genuine and who's an interloper

I don't need to read minds.

Bush, Obama, and Biden expressed coherent, reasoned ideologies and plans of action, and as presidents, acted consistently with their own words and deeds. I may have disagreed with Bush's policies, but I know that he actually believed that what he was doing was what he thought was best for America based on his ideological beliefs, because he was able to articulate why. (And those ideological beliefs didn't change on a whim and weren't centered around what was best for him personally.)

Trump doesn't issue coherent thoughts. He doesn't use reason. He can't explain why he does why he does because he doesn't act based on reason; he just goes base of whatever feels good in the second it's flashing through his brain. At the start of the month, he changed his mind on tariffs literally dozens of times in a few hours; so quickly and so frequently that even his own White House didn't know what the tariff policy was for several days. The Secretary of Treasury even said that the best place to find out what our tariff policy was is the President's twitter account (never mind that Congress determines tariffs, not the president).

Everybody is great until they're the worst ever. If someone disagrees with him for whatever reason, they're losers and traitors and maybe should go to jail. Every member of his first administration refused to come back the second time around, so he calls them all losers and traitors. He appointed Powell to the Federal Reserve chair, and now he's calling him Biden's puppet for not doing the stupid thing Trump is demanding that he do to bail him out of the other stupid thing Trump is doing. He appointed two of the justices to the SCOTUS and hundreds of federal judges and now he's calling them "out of control" because they won't just roll over and okay the unlawful things he's doing.

Coordinated strategy will be against the democratic vote.

I'd wager that some people in this administration are banking on there not being a next administration

Trump's been obsessed with them since the 80s. That seems to, er, be... about all the rationalisation that is required. No-one thinks this is a good idea; he managed to dig up the world's weirdest economist to give his blessing, and that's about it.

The world’s weirdest economist who then made up an even weirder economist to bolster his case.

https://www.nytimes.com/2019/10/16/us/politics/peter-navarro...

Bigly smart, everyone's saying it: https://en.wikipedia.org/wiki/Pseudonyms_used_by_Donald_Trum...

Pretty much, it will only look great for the next incumbent president to remove the tariffs that were put in place immediately.

And realistically even if major companies moved their businesses to the US, they would still need to pay US prices for the goods and people that would make them. I am sure someone has done a simple cost analysis, but prices would be higher regardless as it costs more to make the stuff in the US.

Although a 3090 is still a kickass GPU, it should still play new AA games for a long time (someone with a 3080).

> I can tell you, for myself? Any major purchases are now off the table. I will happily keep my 18 year old car running instead of buying a new honda civic.

Aren't Civics made in the US, with mostly US and Canadian parts? They might come through the tariffs without too big a hit.

As long as the tariffs reduce competition, the prices will still increase. Stuff isn’t priced at cost.

Apparently the hybrid hatchback Civic was made in Japan, but now Honda is moving production to the U.S.

https://www.channelnewsasia.com/business/honda-shift-product...

You are not thinking like a mob boss.

The tarrifs have no economic purpose, they are a bullying tactic. Congress controls the ability to levy taxes for a good reason, which is to prevent executive abuse. Trump and his republican supporters are using the tarrifs like the kings of old to negotiate favors and support.

The tarrifs were applied across the board, and will slowly be trimmed back as people kiss the ring.

> I've honestly never understood the point of the tariffs.

They are being implemented by people that think that "evolution is just a theory", "global warming is a hoax", "vaccines cause autism and are dangerous", etc.

Free trade is a core belief of Economics as a science, from Adam Smith's "Wealth of Nations" until the Nobel Prize of Economics in 2024. And discarding inconvenient science is a standard among Republicans (viz their attack on universities).

They're just morons.

I think you're only half right. Most people are woefully undereducated or unwilling to gain knowledge for the sake of understanding things in the modern world. A fatal flaw, because then they rely on smart sounding people, dressed in nice clothing, to tell them how to think.

> I've honestly never understood the point of the tariffs.> At the risk of sounding rude, why the hell don't you understand the point of tariffs?!? Look up as many source as you can on the internet and learn something! You could also read some books.

The "the" in "point of the tariffs" is enough to say that a specific collection of tariffs is being referred to, not the general concept of tariffs.

Given the Trump tariffs are the subject of the article this discussion is attached to and those tariffs are a major current event, they're the obvious default expansion of "the tariffs."

Er, the "the" is in my sentence. You either don't understand tariffs or you don't understand "the point" of tariffs. Let's clear this up, shall we? (And don't try to wiggle out of your original statement, please.)

wing-_-nuts 10 hours ago | prev | next [–]

I've honestly never understood the point of the tariffs.

wing-_-nuts said it, diego_molta quoted it, then you quoted it again and went off about it for some reason, ignoring the 'the' in the process.

Have you considered decaf?

<sigh>

Yes, I know. Decaf can be quite disappointing at first. But you seem a little high strung, and the reduction in caffeine intake might be good for you.

Sounds like a win for the climate, as a nice side effect.

Unlikely. The other policies is literally designed to remove as much environmental protection as possible, I guess to own the libs.

Except that solar deployment in the US will be massively impacted by this. And that at a time where we are supposed to bring back energy-hungry manufacturing and in theory would need to expand the electrical grid.

Good thing there's lots of coal-fired power plants that Trump just exempted from stronger emissions controls.

Yes well, covid was a nice win for the climate. It was also a massive and devastating recession which we basically money printed our way out of. It would be nice if we could address climate issues with direct legislation instead of suffering on the population level (I will be fine)

Here come those pesky direct effects:

"US to impose tariffs of up to 3521% on south-east Asia solar panels"

https://www.theguardian.com/business/2025/apr/22/us-huge-tar...

Edit: added title

> I've honestly never understood the point of the tariffs

Nor, seemingly, does the U.S. president. It’s the same rhetoric we’ve heard from him since the mid 1980’s onward. “We’re being ripped off,” “We’re being laughed at,” “We need to fix the trade deficit…tariffs…” A case of arrested development. Going back to his earliest projects as a nominal real estate developer, the same inability or unwillingness to capitalize on the expertise of others to the detriment of most of his endeavours. Except for image-making. There he excels. This time, the project he is inevitably destroying is the global economy. And there’s no Fred C. Trump to bail us out.

I read recently the tariffs are the policy of some guy Trump latched onto because Kushner likes the title of his book ("Death by China")

Trump took out full page ads about this in the 80s.

The guy in charge of them is still the guy I'm referring to though lol

Ah, I see. Wow.

Trump now has knobs he alone (unless congress stops him) can turn to save or wreck any country, even specific businesses and people (i.e. those that don’t surrender more power to him). For a power obsessed, extreme narcissist, that is worth more than economic success.

The only country he is wrecking is the US. Every other country can still happily trade with every other country.

Sure, for some countries it will hurt short term, but long term they will all just increase trade between each other and do perfectly fine.

China’s exports to the US are only 7% of their GDP. Even if all that went to zero, they’ll still have the highest GDP soon enough.

I don't think a lot of Americans know this: the EU is China's biggest trade partner.

And the EU has free trade in it's DNA.

cough mostly protectionism, I'm afraid cough.

The EU roleplays as free traders (for exports), but if you look at their actual behaviour (particularly around agriculture) then you can see that they're also a big fan of protectionism at times.

Free trade? They put tariffs on China in October 2024, before the US Election.

https://www.reuters.com/business/autos-transportation/eu-vot...

> The only country he is wrecking is the US. Every other country can still happily trade with every other country.

I mean, sortof. Unfortunately both the EU/China/everyone else has been running an export led growth strategy which relies on the US consumer buying their exports.

So, buckle up everyone, it's gonna be a wild ride (and maybe read Trade Wars are Class Wars to understand where the administration may be coming from).

Donald Trump does not need to win an election in any of the years you named

Trump wants to get rid of income taxes for those earning under $150k.

He most likely intends to pull out the financial pillar of income tax, and replace it with tariffs. He is likely waiting for the price crunch to blow up so he can step in an give everyone the "gift" of no income tax.

It would only make sense if consumption of tariff-imposed goods would keep steady to make up for the loss of income taxes, with consumer confidence cratering there's no way consumption keeps steady. On top of that you have inflation which will cause the Fed to raise interest rates, further lowering credit offering for consumption, bond yields raising which costs more of the budget for interest payment, requiring more taxes, it's a stupid plan all around...

Income taxes are progressive while tariffs are regressive, so those under $150k are likely to be worse off.

He's not particularly intelligent.

About 3/4 of households make under $150k/year. Having no income tax will be hugely popular with them. It would kill the argument that Trump is only interested tax breaks for the rich.

It would also make it politically untenable to get rid of tariffs and reinstate income tax.

Yea, this is the thing. Can you imagine transitioning over to a 0 income tax situation and then adding all of that infrastructure back? You know DOGE is going to nuke the servers that do it and rm -rf the repositories so if it's ever returned to law, everything will need to be done from scratch (likely making it untenable).

If you're an IT professional in the US Government, I would argue you have an obligation as a concerned citizen to make some local backups of the code powering the systems you work on every day and keep them somewhere safe...

Or it would make it politically quite tenable to get rid of tariffs and greatly raise income taxes on people making over $150k.

They already do pay the vast majority of income taxes.

The main takeaway from this fact being astonishment at just how much the top 1% really earns!

True, they pay around 75-80% of income taxes.

I suppose the good news for them then is that if tariffs fail to replace the 20-25% of income tax that would be lost by eliminating income tax on people making under $150k and it has to come from raising taxes on the folks making over $150k it would only be a 25-33% tax increase on them.

It's a good start, now let's raise capital gains taxes to where they rightly out to be (i.e. more than sweat-of-the-brow income, not less).

That's because they make the vast majority of the income.

People really don't comprehend how much money the top 0.01% makes.

I don't see the numbers though. Tariffs are a compete non-starter as far as government revenue goes, "income from tariffs" on the "countries that have been robbing us" is mere theatrics (those countries only accepted what was given/pushed to them)... Ergo, borrowing remains the only option, with lots and lots of inflation. I'm not sure how popular that will be.

On first glance that's the case, in practice they clamp down hardest on middle and professional classes. The rich borrow against gains or pay long term capital gains, or just "re-invest" (no profit) into durable assets for their business that hold value longer than they'll be alive.

The scam of income tax is that it's progressive on paper but not in practice.

You are not wrong, but that situation won't change if you moved to another taxation scheme. The poor are too poor to have much to take from them. So they go after those who are a rung or two above to tax. The dynamic does not change irrespective of taxation system.

"The scam of income tax is that it's progressive on paper but not in practice."

Perfectly put. It's always bothered me that the tax brackets don't continue on in a logarithmic fashion, e.g. new brackets at 1.5 million, 15 million, 150 million, etc.

Focusing on brackets for earned income is a distraction. Those only apply to relatively rare sports stars, actors, etc. The real cheats are things like tax rates being lower for capital gains, and that people receiving rental/royalty income can subtract all of their expenses (whereas wage earners cannot).

Arguably a bigger cheat is that if you have enough wealth tied up in stocks, you can realize capital gains for the sake of taking out loans to live off of without having to realize the gains for the sake of taxes. Then, you can pass those investments onto your inheritors with a stepped-up cost basis so they don't have to pay tax on the gains, either.

Yes even though I'm no fan of taxes, allowing borrowing against gains is clearly "realizing" them, it is an absolutely absurd fiction that allows this to be untaxed.

Ah yes: buy, borrow, and die. It definitely works.

I don't think stepped-up basis should go away though, otherwise it's just the government getting a second cut of the inflation it causes.

The bigger issue for society is that our equity markets just don't have any real risk of losing your lunch anymore, so these strategies emerge.

Sure, that was already mentioned and I skipped mentioning it again because focusing too much on that one thing is likely to distract from the overall problem. It's not bigger, it's just different. It has also been made less attractive now that interest rates exist again (at least for the time being until Krasnov gets his hands on that lever of market manipulation)

(another one in the same vein is that when you donate an appreciated asset, you get a tax deduction of the unrealized value)

> The rich borrow against gains

That they have to pay back with interest. This made a little sense except for short-term loans when one had liquidity issues when interest rates were close to zero or in very, very limited circumstances where someone knew they were close to death - but that more has to do with the broken way we handle taxing inheritance.

With the prime rate is 7.5% today, it makes far less sense.

> "re-invest" (no profit) into durable assets for their business

Capital expenditures aren't subtracted from revenue. They have no effect on profit.

>Capital expenditures aren't subtracted from revenue. They have no effect on profit.

This is a cheap slight of hand to confuse unsophisticated readers. It has effect on taxable profit since much of cap ex is deductible.

> since much of cap ex is deductible

Since when?

Last I checked, capex was not deductible. You can deduct depreciation of assets over time, but that's not going to offset profit to create a loss unless you're spending far more money than you profited (by say, taking out loans).

There is the expiring bonus depreciation provision on a limited limited class of assets which would let you create a loss, but even that's subject to recapture if you sell those assets.

How are tariffs regressive? Income taxes are obviously progressive. If you earn $100,000 you are going to be paying a higher percentage of your earnings compared to someone making $10,000 or $50,000. It's not intuitive that someone who makes $100,000 is going to be paying less in tariffs than someone making $50,000 though. How does that work?

They’re regressive in the sense that people with lower income spend more of it on consumption than people with higher income or wealth, who can save or invest at a higher rate.

Yes, with Trunp everything is a lever he's using in a negotiation to get what he really wants. I'm not claiming he's playing "4d Chess" or is some kind of wizard but everything is a "deal" to him.

>Trump wants to get rid of income taxes for those earning under $150k.

Trump has openly talked about his plan to replace income tax with tariffs for years. Not just for "earnings under $150k" -- that was some post-facto inventions by Howard "Used Car Salesman" Lutnick on some news program appearance after tariffs were proving spectacularly unpopular -- but Trump has constantly ruminated on the grand old days of the 1890s, at least when he isn't talking about that ol' timey word "groceries" or showerheads, light bulbs and coal. And every economist save a few nuts like Pete Navarro (or his associate Ron Vara) have soundly announced that it's an incredibly stupid plan.

Here in reality, thus far the only tax break offered up has been an extension on tax reductions for the super rich. No tax free tips, overtime, etc. Only the super rich have benefitted.

Further, it economically makes zero sense and Trump has repeatedly argued completely contrary "wins" from his tariffs: both that all of the manufacturing and other production will return to the US (ignore that the US has effectively full employment, and such would be massively inflationary without a dire reduction in US quality of life), yet somehow he's going to make trillions from tariffs, which would require such an egregious tariff rate that there would be no imports at all and thus no tariff income. Federal spending would have to drop by almost 80% for tariff funding of the government to be remotely rational, and that means demolishing the military and social security.

>so he can step in an give everyone the "gift" of no income tax

Yeah, that isn't at all how Trump operates. Much like DOGE and their hilarious "$5000 cheques for all the savings" that will never, ever happen -- and quite the contrary the government financial position is more dire than ever -- Trump makes all of his promises up front. Like his tips and overtime tax claims, both of which are never going to happen. Or his amazing healthcare plan that's coming in two weeks. Or how about that line of countries offering everything and their 90 deals in 90 days. This guy is the definition of overpromising and underdelivering.

There is zero scenario where tariffs even cover the current deficit. And as Trump demolishes the credibility of the USD and US TBills (people don't realize that US banks have been increasingly forced to buy these as the global market as dissolved), it's going to get drastically worse.

You stumped most everyone when you used the word "reality". (Which is correct.) Most are so scared of where the country is heading, reality is pretty foggy. "Criminality", now there's a timely word we can all understand, except the big orange dummy has manipulated the supreme court so much we're not sure if we can trust it to maintain the rule of law. (After all, the tariffs seem to be a tool to crash the stock market, buy low/sell high, no?) Shamefully, it doesn't take much to completely fool the boomers (My generation, the stupidest of all time.) by making enemies of almost anything or anyone.

We're well on track to move the debt crisis we were already all-but guaranteed to see in a few decades, to... this decade.

Take the nugget of truth that is the problem (there are inefficiencies in government work, there are arguments that tariffs could be adjusted for economic reasons) and act like the deliberate system breaking actions being taken aren’t the part worth discussing. Then blame immigrants, China, and “something something woke”. Then let “centerists” distract/water down the conversation by injecting random “both sides” arguments to frame things as nothing out of the ordinary and nothing to be done.

>Trump wants to get rid of income taxes for those earning under $150k.

Getting rid of income tax will require legislation from congress. If we're in the midst of a tariff induced recession, what are the chances his party keeps congress in '26?

Also, remember when the British government tried to pass a massive tax cut funded with debt? Remember how that went down? The chances of the US being able to get rid of income tax in the next 4 years is basically zero.

> Getting rid of income tax will require legislation from congress. If we're in the midst of a tariff induced recession, what are the chances his party keeps congress in '26?

Their chances will maybe be higher, if they cut income taxes.

All it'll cost is moving our already-nigh-inevitable debt crisis a few decades closer to today.

> Also, remember when the British government tried to pass a massive tax cut funded with debt?

Both Republican administrations this millennium have done exactly that. I see no reason to expect they won't do it again.

> Getting rid of income tax will require legislation from congress. If we're in the midst of a tariff induced recession, what are the chances his party keeps congress in '26?

The optics of Democrats voting against a full tax cut for those earning less than $150K would be interesting to say the least.

I mean someone's gotta be the responsible adult in the room right? Every projection I've seen on tariffs doesn't put the revenue generated anywhere near enough to cover cutting income tax. You want to rework the tax system, be my guest, but pay for it, and don't tank the world economy in the process.

If the tariffs are able to act as a sustained source of revenue then they're not working to bring manufacturing back to the US. If they work to bring manufacturing back then they're not going to raise much revenue (long term). Either way, the bulk of the pain is going to be borne by average people.

But he also says the tariffs will bring manufacturing back. If that works then the tariff money tanks.

He wants to get rid of his taxes, reducing other people’s taxes is part of the deal. Tariffs are moving taxes around, everyone pays but he’s hoping that he will be the least affected.

Actually-rich people pay little or no income tax.

Most of what they pay is capital gains, and usually the long-term rate (15% or 20%, depends), which is lower than all but the lowest two (0%, 12%) of seven brackets applied to people who actually work for a living.

Plus they don't pay FICA on that, which is another ~7.5% for W2 and ~15% for contract workers.

Also, they often manage to avoid even paying the long-term capital gains rate.

It depends what you mean by rich people. Do you mean people like Doctors and Lawyers who work for their money, or do you mean investors and CEOs who created a company worth millions/billions, and the shares they own in that company mean they are also worth millions/billions. Because I can tell you the former certainly pay income tax, and I have heard from many doctors and lawyers that they weren't planning on working on that weekend because that marginal tax rate made the juice not worth the squeeze so they spent the weekend on the golf course instead

You're not really rich if you have to work for pay to maintain a (relatively) expensive life style. It's the distinction between the rich and the "professional class" or "upper-middle class". The really rich are capitalists, in the sense of making their money from owning stuff.

Looks like the top marginal rate's about 50% (including the top state rate of ~13%), but that's also way past the point where FICA's dropped off so it's not quite as bad (relative to middle tax brackets) as it looks. I can definitely see turning down ~50% of (say) $2,000 in exchange for a free Saturday if I'm already making north of a quarter-million a year (individual—brackets are higher for joint filing). Hell, when I was a freelancer, for every single vacation I took the main cost was foregone income, so I've even done basically that exact thing, though without being in that high a tax bracket. In fact, even today, I could probably take on paying work many weekends, and never do, so I make the same choice all the time despite being well under the top tax bracket.

Like, working the weekend normally isn't worth it for most people who can possibly afford not to do it, tax bracket be damned. Did these doctors and lawyers work a pretty normal number of hours that week? If so, I don't really understand what you're getting at. Seems like they just wanted to frame a normal thing most people do as a complaint about taxes.

This is entirely contrary to their other supposed goal, which is to bring back manufacturing. If we bring back manufacturing, tariffs won't pay our bills, because nobody will pay them.

It's almost like it's bullshit.

Well, just to play the devil's advocate a bit, this is definitely a crazy idea but it might have some logic to it:

1) taxing consumptions instead of income has the advantage of being much harder to evade. It puts an end to tricks like living off loans or even simply detracting expenses- you cannot detract anything if you're not taxed at all;

2) only taxing imported goods means that anything that benefits the local economy can be purchased tax-free; while imports from abroad become, say, twice as expensive as before. However, you also have a much higher disposable income and, at least at the beginning, no other option.

So the gist of it would be: we levy the same amount of money as before by taxing exclusively consumptions, and we exempt from taxation all domestically produced goods because it's still money reinvested in the economy.

The problem is that you massively distort the economy, making it less efficient aka poorer. And that's even before considering the fact that other countries will retaliate.

Wasn't the income tax introduced as a temporary measure in WW1, and prior to that the majority of state income was generated via tariffs? Shifting the burden can certainly cause distortions, but we already caused those distortions getting into this situation in the first place.

Tariffs were done in the past because they were easier, but I think they distort less than an income tax. You're literally favoring domestic producers, right?

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